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Discuss // Do startups generally look for business development associates?

Do startups generally look for business development associates?

Hi everyone,

I'm at an interesting point career wise and could use some advice. Currently I'm a Business Development Associate at a financial services firm. I'm starting to become kind of the face of the firm, as they send me to lots of events, meetings and calls with clients, referral sources, and other firms/people we should know. It's a really good skill to have in finance which is a world filled with socially awkward people who need more social people to grow the firm and close deals.

However my true passion is for startups. I'm working on one now and would like to move my career in that direction. I'm interested in going to biz school in Austin for entrepreneurship and I'm seriously considering moving out there before school to work at a startup.

So after all that set up, my question is do startups generally look for someone with my skill set or should I stick to finance until I begin my MBA?

Also if I should pursue startups what is the best way to connect w/firms that are looking? Recruiter?

12 Replies

Hey
Some startups do need BD. They are typically making products for businesses, or discrete consumer products that will be sold in stores/online. Consumer Internet startups generally have less emphasis on BD and sales and more on viral marketing.
Skip the MBA for a bit. It will not help you much at an early stage startup, it will constrain your thinking. Go work for a startup for a year or so and then decide if you still want an MBA.
To get hired, search venture portfolios and angel networks in Austin for local startup companies. Then email in your resume and call them. Early stage startups generally don't use recruiters, too expensive and a lot of recruiter candidates have the wrong (big corporate) background. Startups respect self starters who take initiative, so emailing and calling and explaining why the companies need you for BD will be your most effective approach.
Cheers,
Adam

BD is pretty valuable to a variety of startups. Look on AngelList and CrunchBase (StackOverflow too, but I don't know if they do nontechnical jobs). Recruiters are iffy; really early startups don't want to spend the extra commission that they demand.

Make sure you know what you're getting into. Startups demand long hours and the pay often isn't great. You also really need to understand startup equity, vesting, and dilution like the back of your hand or you'll probably get shafted on any equity grant you accept. Do your homework.

A BizDev role (with or without MBA) is generally dead weight and a liability to the P&L for most startups under 24-30months old. All the capital, every damn cent, is generally needed for Engineering , Product , Vendors at that point.

The founders also need to be doing a lot of the BizDev , as it's largely customer development at that point... and potential customers want facetime with management as a sign of their seriousness and commitment. Handing a potential client off to a BizDev person has killed many deals.

By the time most startups are ready for a bizdev role, they're not really a startup anymore. If you want the startup experience and knowledge, you're going to have to sell yourself in as more than just BizDev -- Project Management, Product Management, PR, Office Operations /Admin, etc -- if there's something more you can add to the team, you'll may be worth the cost.

Also you should think about what you want out of the job -- money , experience, or both. The bulk of startups using a recruiter are somewhere between their SeriesA and SeriesB rounds - so any sort of equity compensation is going to be minimal. You'll get a token stock option ( though the company will try to overstate it ) -- but it's a token; your compensation should be focused on market-rate salary and benefits.

Luis,
Go get your MBA And pivot towards product management or go do your oyen startup.
In my experience, BD is a function that the CEO/founders carry early on, by the time a startup needs to staff up with BD the significant upside is gone (50+ employees).
There are always exceptions (say your startup wants to sell into the financial services sector), but generally I would say that BD is function for corporate America, and sort of a dead end in the startup world.
I'd be curious to hear what other replies you get. Care to share?
Regards,
Juan

I would tend to think of your skills as really important for a startup for A) fundraising B) if my product/service was in the financial space Otherwise I would be looking to see is this a really smart guy who can fill gaps and does he have enough experience running a business to help plug holes? Finally, is this guy willing to do whatever needs to be done? (I once had a PMP project manager spending his days doing $200 sales calls to other businesses, it was really helpful to have a really smart person willing to make those calls and notice patters, figure out what worked etc...)
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Does getting an ASU MBA with existing UofA BSCE make me a SunCat? or a WildDevil?
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Hi Luis, I would agree with most of the earlier comments. A few things to add:

* Network, network, network. There are lots of gatherings of people that are in the startup world...look for them in your area. Coffees, beers after work, etc. You'll learn a lot and might find the opportunity you want there.

* BD skills are transferable to other functions...sales (inside sales is more likely in startup, since the founders are likely to be doing any needed outside sales...depending on stage of the business), marketing, customer support...all could be up your alley. Keep you options open and be flexible if you really want to try out the startup experience.

Hi Luis,
Business Development position can be very important if result can be attained for the Startup you intend to work for. This position could involve raising capital, opening doors to potential clients, etc.
Unfortunately, startups generally do not have the funds to hire a business development person, despite the dire need for one.
So, if you are flexible about your compensation, such as performance based fee derived from the commission on the deal you bring in, it can be very valuable to the startup. If you become so valuable, then the you can negotiate an equity in the company, or option, or be one of the founders of the company (even if you are not the original founders).
Therefore, I highly recommend chosing a startup you can be confident about the subject matter and be clear to yourself on what you can bring to the table. The success of the startup and your career will depend on being objective about what you can deliver successfully. Otherwise, everyone would be a sore loser with everyone pointing fingers with each other, and matters get ugly.
Raising capital could be a good fit given your finance background but raising capital in this economy for early stage companies is extremely difficult, if not impossible. So, if you are going to raise capital, find a startup company that either has shown user traction (even if it has no revenue) or producing revenue (even if it is small amount of revenue).
Since startups generally don't have funds, recruiter would be the last place to find a posting for such a position. Places like founder dating, Meetup.com, startup mentoring organizations like Score or a similar one in your neighborhood would be the best place to find the founders. Also, look up state funded startup incubators in your community and they generally can lead to affiliated organizations that can lead to startups in your community.
Kovey

Executive Advisor & Business Coach. I help entrepreneurs survive and thrive at building their teams and businesses.

Hi Luis!
Runnnnn! Run in the other direction. You have a real job and a career!
Don't punish yourself by doing a startup. If that didn't deter you, then
congratulations for joining the band of idiots known as entrepreneurs. =)

Director at PetHero, SPC - Member at Eastside Incubator - Principal at Tuxedo Technologies Group

luis, please clarify what you mean by "business development". some use the term to avoid the oft reviled term "sales". startups need 2 things as an absolute minimum: 1) product and 2) sales. sales in a startup needs to encompass BD too (BD originally focused on building partnerships, i.e. lead generation, distribution, fulfillment, etc.) just because everyone is a startup wears a lot of hats early on. If you can help a startup generate revenue by whatever means (outside sales, inside sales, partnerships, marketing, fundraising, etc.) then you ad significant value. If you are skilled at BD then put those skills to use: identify your prospects (which kind and stage of startups), understand their business, understand your value proposition to them, identify the decision makers, go pitch em. Many tech startups focus solely on product and don't know where to start to drive revenue/customer development so you will ad the biggest value to those teams who are solely technical and very early stage - big risks, tons of work, tons of fun. Results are key as startups don't have the luxury of taking a flier on some new guy and paying a salary for 3-6 months before they find out if s/he can more than pay his/her weight. Ideally you would demonstrate to the founder(s) that you add value from day one by brining them a partnership or customer. There are many, many startups out there. the vast majority will fail. do your homework. If after a little homework you can't clearly understand and articulate the startup's value proposition and competitive advantage to prospective customers and get those prospects to commit to learning more then move on to the next startup.

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